The A2 Milk Company Ltd (ASX: A2M) share price was on form on Monday.
The infant formula company's shares rose 2.5% to $5.70 following the release of a positive update on its Chinese product registration.
This means the A2 Milk share price is now up over 15% since this time last month.
Can the A2 Milk share price keep rising?
The good news for investors is that one leading broker still sees plenty of upside in the A2 Milk share price.
According to a note out of Bell Potter, its analysts have retained their buy rating and lifted their price target on the company's shares to $6.60.
Based on where its shares are trading today, this implies potential upside of 16% for investors over the next 12 months.
What did the broker say?
Bell Potter highlights that Australia-China exports, which is seen as a daigou proxy, were up 111% year over year in July. It notes that this is "strongest read in nine months."
In addition, China infant formula imports were up 31% year over year in July. The broker highlights that "China landed volumes seemed to find a floor in Apr'22 and have been climbing since."
All in all, the broker appears to see this data as supportive of its estimates. As a result, the broker continues to forecast strong earnings growth in the coming years. It commented:
Our Buy rating is unchanged. If A2M can execute on its strategy to achieve ~NZ$2Bn in FY26e revenues and EBITDA margins in the teens, then it would imply compound double digit EPS growth through to FY26e. With an increased focus on direct channels to market (73% of 2H22 IMF sales) we see the offline expansion program as key to achieving these targets, noting that A2M is relatively underrepresented in this segment, suggesting a reasonable runway of growth.
